Luminant enters the 2015 property tax appraisal process with the sincere desire to pay our fair share of taxes just like any other business or homeowner. Our goal is to work with county appraisal districts to determine the taxable valuation for our power plants and mines through negotiated agreements and pay our taxes in January 2016 as usual.
The decreasing taxable values at our plants and mines are caused by market forces. Sharply lower wholesale power prices, driven by low natural gas prices that have steadily dropped since 2008, mean less revenue at plants. Less revenue means a plant holds a lower property value in the year ahead.
The longer term trend for revenue at our plants has continued to go down. In 2008, average annual wholesale power prices were more than $63 per megawatt in the ERCOT market where we compete. In January 2015, wholesale power prices averaged $23 per megawatt.
We understand that lower tax payments affect local governments and schools. However, as a longtime member of the communities where our plants and mines call home we are always concerned about their overall success. Regardless of conditions driven by market forces, we remain the top property taxpayer in our communities and are committed about paying our fair share.